The Battle Over Airbnb Moves To Los Angeles

The latest front in the struggles over the future of the sharing economy is in Sliver Lake, where some residents want to ban the short-term rental company, while others extoll its virtues.

Anna Scott found herself in the minority at a neighborhood council meeting in the Silver Lake area of Los Angeles last Monday night.

"I’m against Airbnb short-term rentals," she informed a crowd of more than 150 people who had come to speak their mind about whether or not the neighborhood should advise the city council to ban the service from the country’s second largest city.

I have the right to contract with my fellow citizen and rent to them without getting anyone's bloody permission.

It's just latest in a continuing battle between municipalities, sharing economy companies, and the industries those companies are trying to "disrupt." In New York, Airbnb hosts have been fined thousands for violating the city’s illegal hotel laws. Earlier this summer, Uber and Lyft drivers were arrested at the San Francisco airport for trespassing without a permit. And in LA, those two companies were issued cease-and-deist notices (but continued to operate), thanks in part to complaints by the taxi industry that the newcomers were avoiding compliance with safety regulations.

"The element of noise is a huge issue," says Scott at the hearing, whose next-door neighbors rent out their home using the site. "You cannot tell me that you’ll be able to educate somebody coming in for one night, two nights, ‘Please don't come in at 2 AM because the people next door are gonna hear you.’"

A litany of other problems—including parking shortages, blocked garages, and the sense among neighbors that the service is bringing un-vetted "transients" into residential communities—has resulted in scores of complaints sent to the Silver Lake Neighborhood Council in recent months, as Airbnb has exploded in popularity across Los Angeles.

Earlier in the summer, the council’s urban design committee began exploring whether a ban made sense as a way to resolve the issue. Last week, community members were invited to voice their opinions for or against the ban.

Things got rowdy.

Editor's Note

Airbnb supporters far outnumbered opponents and audibly booed ban-supporters like Scott. (A volunteer at the church where the meeting was held counted "a dozen people crying" on their way out.) But more than just demonstrate their passion for the service, they gave a taste of the future of the sharing economy as it becomes an organized political force—albeit on a small-scale—thanks in part to a new, international activist group called Peers, whose mission is "to grow the sharing economy, to mainstream it, to tell its story, and to protect it," in the words of founder Natalie Foster.

When Peers got wind from Sliver Lake Airbnb host Matthew Desario about the ban proposal, they helped Desario post and distribute an online petition in support of Airbnb—which has since been signed 5,000 times—and get the word out about the September 9 meeting, resulting in high attendance from Airbnb backers. It was the first local action for the young, Bay Area-based organization, but a taste of what may become common as more and more cities respond to the growth of the sharing economy with bans and fines.

"Every city has a different set of regulations," Foster points out, and a different way of responding.

Wherever there‘s a backlash, "we'll be supporting our members in advocating for smart regulation that allows for the sharing economy to grow," Foster adds.

We'll be supporting our members in advocating for smart regulation that allows for the sharing economy to grow.

Ideally, that would involve some tweaks to the zoning rules in Los Angeles, which forbid anyone from renting out their residential unit for less than 30 days. "The majority of [LA hosts] are renting for less than four weeks a year, total," says Airbnb spokesperson Nick Papas, which is technically illegal, even if those weeks were consecutive.

While enforcement by the city has been nonexistent so far, that could change. Monday’s meeting "was the first time that the city has gone on record and said that [Airbnb rentals] are illegal," says Scott Plante, a representative on the Silver Lake Council, referring to a statement made by a city-planning official who addressed the crowd.

But based on what Airbnb hosts at the meeting were saying, the city’s 30-day rule is nothing more than a nuisance to be ignored and was described almost like an invasion of homeowners’ privacy.

"I have the right to contract with my fellow citizens, invite them into my home, and rent to them without getting anyone's bloody permission," said Chris, a silver-haired host in Silver Lake whose house was foreclosed on by Chase Bank several years ago. "I had to make a deal with [the bank] to pay 7,500 bucks a month for the year. How was I gonna do that?" After his daughter helped him put it on Airbnb, "I’ve had it rented almost continually [for two years straights] for 6,000 bucks a month, got out of foreclosure, and—thank God—now I get to live in my home again."

In the context of the recession, the contracting entertainment industry, and LA’s high unemployment, those success stories of using Airbnb to recover from financial hardship were shared over and over at the meeting on Monday. Others spoke about the fascinating people they’ve hosted or the positive economic impact the infusion of tourists brings to local businesses in Silver Lake, an area whose rapid gentrification over the past decade has brought an excess of restaurants, bars, and clubs—but no hotels. (There are 212 Airbnb rentals available in Silver Lake, where 32,000 people live.)

A recent study by Airbnb on its economic impact in Berlin backs up those claims. The average Airbnb guest visits the city for four days longer than the typical hotel guest and spends about $500 more. "The Airbnb community contributed nearly €100 million in total economic activity in one year," reads the report. Airbnb’s Papas says that the company’s relationships with the hospitality industry are good (unlike, say, those of Uber and livery companies). "Hotels in this country and around the world have really almost never been doing better," he says, pointing to high occupancy rates. He argues that Airbnb isn’t stealing hotels’ business but "gives more people the opportunity to travel." (But in some cities, like Montreal, government crackdowns on Airbnb have been linked with the influence of the hospitality industry. Last year, the company brought on a head of global public policy to help lobby governments around the world.)

It’s telling that in Silver Lake, it’s not the hotel industry that’s pushing for a ban, but aggravated neighbors. Desario, who organized the petition which was delivered to the council at Monday’s meeting, says he hopes to work with those who don’t support the service to bring about more sensible regulations. "I'm not an advocate for it being completely unregulated and without any type of redress for nuisances or abuses," he says. "My argument was that the real benefit far outweighs any potential, hypothetical negative consequences."

Based on the outpouring of support for Airbnb, it would seem that the neighborhood mostly agrees with Desario, which ought to affect the position that the neighborhood council takes. But Plante points out that many who oppose Airbnb are afraid to speak up for fear of being bullied in the neighborhood. He says the council will wait for the city to publish a "position paper" within 60 days about its policy for dealing with illegal short-term rentals.

Desario said he’s concerned about some board members on the council who have taken an attitude about the ban that "it’s going to happen whether you like it or not." Others on the pro-Airbnb squad are equally strident about their support for the service. A wardrobe stylist and longtime Silver Lake resident who goes by Janet Planet was passing out business cards with her Airnbnb info on them.

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Substantially all short term rental units operated by professional managers and superhosts are compliant with local occupancy tax provisions and other regulations throughout the U.S. Self-managed units need to be given clear local rules and paths toward compliance.

In those ways, consumers can be protected and tax revenues can be raised effectively through tourism, the original "green" business.

Unfortunately, rent controlled tenants in the same building, or living next door, who are constantly disturbed by short term rental unit use do not have the option of moving because they cannot afford to pay market rents for equivalent housing elsewhere.

I live in a two-story duplex in Marina Del Rey. I live underneath a non-stop vacation rental. It is the worst thing I can ever imagine. Noise, noise and more noise. My landlord is making a hefty chunk of change for weekend rentals or folks staying a week. I, however, haven't had a decent night of sleep or a peaceful weekend in 22 months. It is unbearable, and according to my understanding of residential zoning ordinances -- illegal. The city does not allow commercial rentals (i.e. fewer than 30 days without property owner on premises) in a residential zone. I have called everyone -- from the mayor's office to my city councilman (Mike Bonin) to U.S. Senators. Everyone agrees it is problematic but no one does a darn thing to stop it. When a vacation renter kills, rapes or molests a long term renter or a property owner -- the city will finally do something. There are currently six teenage girls jumping on my ceiling at this very moment.

I have a new neighbor who listed their home on airbnb. Lots of goings on in the house since the new owners; this past weekend a group of loud college students on a fraternity retreat. This is a problem.

We are having the same problem in another area of Los Angeles and I wondered if you could get me in touch with Matthew Desario of Silverlake. I'm curious if the Silverlake City Council has issued their edict on this matter.

My understanding is that the Silverlake Neighborhood Council voted not to ban Airbnb because there is already a law against such rentals. A majority of the board members are now pro-Airbnb. So any of the board members who rent out short term are breaking the law. Even while these short term rentals are illegal in Los Angeles, the City is NOT prosecuting them so these types of fights are occurring. It is happening upon my street. I have tried to get the owners prosecuted, but the City has not acted. But the owners of the house have acted by trying to sue me, but thank goodness, they LOST!